Bitcoin is blowing UP, please stop it!

[wareen]

I think the fact that bitcoins popularity stalled in the beginning is a problem now. I have no problem with someone being 10-100+ times richer than me, but I view the current situation as problematic where about some dozen people each own more than 0.5% of all currency ever to be in existence.

Yes, I understand and share your concerns. But I'm afraid there's probably not much that can be done about it. Also, slowly buying 100k BTC is very well within the reach of many people or investors right now, so this is not something a restart of the blockchain or a switch to another coin would solve.

I have no problem if they go and buy themselves a nice house now but I don't see that happening from my observation they are going after that kind of power, which I find problematic to build a system upon.

What do you think is the kind of power they are going after?
For all we know, many of the early mined coins which did not get moved might as well be lost - they weren't worth anything at all and the software was buggy.
Also, the BTC-rich probably don't have an incentive to crash the market by selling all at once. If they would do it slowly or use the BTC to buy real-world stuff then I don't see a big problem - the BTC would just get re-distributed over time.

[ElectricMucus]

Yes, I understand and share your concerns. But I'm afraid there's probably not much that can be done about it. Also, slowly buying 100k BTC is very well within the reach of many people or investors right now, so this is not something a restart of the blockchain or a switch to another coin would solve.

Well, actually it does, obtaining that many LTC is not really possible without causing a immediate bubble since it is already more popular than Bitcoin was at the beginning.

What do you think is the kind of power they are going after?
For all we know, many of the early mined coins which did not get moved might as well be lost - they weren't worth anything at all and the software was buggy.
Also, the BTC-rich probably don't have an incentive to crash the market by selling all at once. If they would do it slowly or use the BTC to buy real-world stuff then I don't see a big problem - the BTC would just get re-distributed over time.

If that were the case the decline from USD 30 would have been way steeper with the total number of bitcoins traded being much higher. If that were the case we would already be at the Slope of Enlightenment and possible at higher prices with a more even distribution of wealth.

In the current situation the market has to "force" the bit-rich out of their holdings by declining even further to a point where the success of bitcoin becomes uncertain.
As for the economic power I think some people are after:

Think of a scenario where one Bitcoin is worth the equivalent of one ounce to one kg of gold.
Lets say there is a market for 3D printed goods as a major part of the economy. Such an individual could just buy out all producers of PLA plastic strands eventually creating a monopoly.
Even worse it could be used for economic blackmail like we have seen with recent 'banker bailouts' in the fiat economy or even create something like a 'new royalty'.

As for the hypothesis of lost coins: I don't really believe that. Especially people who went after a significant amount of bitcoins knew what they were doing, I don't think more than 1% of currently issued bitcoins are lost.

[wareen]

The issue is actually not the amount of btc's thats being speculated with, its the volume those trades represent compared to the volume of transactions that represent economic activity. Hoarded btc's dont make  a difference on either.

That only holds true as long as all the goods and services are priced according to the current exchange rate. With a larger Bitcoin economy, the need to continuously exchange to/from fiat will become less and less. Therefore the prices will become less dependent on any fiat exchange rate. Once I know I earn, say 100 BTC a month and have to pay 30 BTC for my rent, then the current BTC/USD exchange rate is only about as important to me as the current oil price.

Of course, that is a long way from where we are now, but I expect that merchants will start to use some time-averaged exchange rates for pricing their goods and services. Maybe once exchanges start to offer reasonably priced options/futures for Bitcoin...

[wareen]

Yes, I understand and share your concerns. But I'm afraid there's probably not much that can be done about it. Also, slowly buying 100k BTC is very well within the reach of many people or investors right now, so this is not something a restart of the blockchain or a switch to another coin would solve.

Well, actually it does, obtaining that many LTC is not really possible without causing a immediate bubble since it is already more popular than Bitcoin was at the beginning.

The keyword here was: slowly. As for LTC it's also because there are not even that many coins in existance

Without having looked at the exchanges - since there are 28800 new LTC mined each day it shouldn't be a big problem to buy 1-2k daily without causing a big bubble. I stand by my assessment: alternate coins do _not_ solve the problem of unequal distribution.

[ElectricMucus]

Yes, I understand and share your concerns. But I'm afraid there's probably not much that can be done about it. Also, slowly buying 100k BTC is very well within the reach of many people or investors right now, so this is not something a restart of the blockchain or a switch to another coin would solve.

Well, actually it does, obtaining that many LTC is not really possible without causing a immediate bubble since it is already more popular than Bitcoin was at the beginning.

The keyword here was: slowly. As for LTC it's also because there are not even that many coins in existance

Without having looked at the exchanges - since there are 28800 new LTC mined each day it shouldn't be a big problem to buy 1-2k daily without causing a big bubble. I stand by my assessment: alternate coins do _not_ solve the problem of unequal distribution.

I don't say they solve it, but dampen it. Since there are that many LTC the amount obtained would have to be bigger, I think big enough that the market will be affected. If you are looking at current prices this doesn't seem to happen yet. But who knows, maybe some miners are desperate enough to sell at any price...

[P4man]

Of course, that is a long way from where we are now, but I expect that merchants will start to use some time-averaged exchange rates for pricing their goods and services. Maybe once exchanges start to offer reasonably priced options/futures for Bitcoin...

Ah. But how could those futures be reasonably priced if speculation creates such insane volatility? And BTC trade in general and stable BTC denominated prices in particular will never become common when price swings are this high.
This is the catch 22: the economy needed for prices to stabilize is hampered severely by speculation induced volatility. And just as bad, this volatility is a vicious circle because high volatility attracts more gamblers speculators.

It will be at the very least challenging for bitcoin to overcome this.

Also, as to the comparison with oil/$; you might not care how much oil costs denominated in dollar if you get paid in btc and pay most of your bills in btc,  but if btc were that common by then, oil and other good would be priced in btc, and value fluctuations of btc would directly impact prices. This is happening today in our dollar/euro/whatever economy, because of speculators gambling on oil, commodity, gold and even food, price swings are considerable even if the currencies are relatively stable. When you add to that a currency thats unregulated and a free target for unlimited speculation, I just dont see how that will work. Your bread will cost 1 BTC one day and 20 next week. Never mind what you'd have to pay for imported good from countries where they dont denominate in BTCs.

[DeathAndTaxes]

Fine, give me a way to earn enough bitcoin to participate in the economy in a meaningful way.
The current average is about 140bitcoin, I will not buy those at these prices (go fuck yourself if you think that's fair) and mining them is no longer possible.

With alternatives it is easy getting an average amount of the pie. With bitcoin you'd have to pay someone elses greed which I am not willing to do.

And if we play this game: I think if bitcoin is ever successful enough to be relevant early adopters will be found out and lynched, sooner or later.
Disclaimer: Not a threat, merely an observation about how things went in history....

What right do you have to an even share of the pie? You don't.  Get your own slice yourself or don't.  You aren't owed anything by anyone.

All the assets in US economy are worth ~$54.2 trillion divided into 300 million people that is ~$180K per person.  Are you also going to say "Give me $180K cash now or I won't participate in the economy."

[ElectricMucus]

All the assets in US economy are worth ~$54.2 trillion divided into 300 million people that is ~$180K per person.  Are you also going to say "Give me $180K cash now or I won't participate in the economy."

There is an error in that and you know it.

At first I haven't said that I won't do anything for it.
Second, Bitcoins economy is just too small to support this kind of economical power.

Third, well from that perspective I would be still better off not joining the Bitcoin economy.

At last:
Bitcoin is an experiment,  both in technological and in sociological sense, that some of you people perceive it as a already done, soon to be dominant paradigm shows that it very well could also fail on the latter issue.

[cbeast]

Bitcoin is an experiment,  both in technological and in sociological sense, that some of you people perceive it as a already done, soon to be dominant paradigm shows that it very well could also fail on the latter issue.

I would say that crypto-currency is a new technology and bitcoin is our experiment with it. Like any new technology, we can make adjustments to get it right. The open source approach keeps it honest and peer reviewed. When we discover how powerful are its properties, then the experimental phase will transition into the industrial phase.

[ElectricMucus]

Bitcoin is an experiment,  both in technological and in sociological sense, that some of you people perceive it as a already done, soon to be dominant paradigm shows that it very well could also fail on the latter issue.

I would say that crypto-currency is a new technology and bitcoin is our experiment with it. Like any new technology, we can make adjustments to get it right. The open source approach keeps it honest and peer reviewed. When we discover how powerful are its properties, then the experimental phase will transition into the industrial phase.

Yes,

However if the participants refuse to cooperate, what we are already seeing partially that what is percived as bitcoin by the speculators, namely its blockchain could be replaced by something else.  This has nothing todo with the project and the idea itself and even confirms to its 'beta' status.

[wareen]

At last: Bitcoin is an experiment,  both in technological and in sociological sense, that some of you people perceive it as a already done, soon to be dominant paradigm shows that it very well could also fail on the latter issue.

True that

We are certainly very far from Bitcoin being a "soon to be dominant paradigm" but it is probably one of the most exciting large-scale socio-economic experiments of recent history. It is simply amazing to see what an impact one little anonymously published open source program can have.

There are all kinds of roadblocks ahead and it is far from certain that Bitcoin will overcome them, but the ideas behind Bitcoin are certainly here to stay and I really hope they will help to make the world a better place!

I for one am happy to be here, witness the progress and do what I can to help!

[DeathAndTaxes]

Bitcoin is an experiment,  both in technological and in sociological sense, that some of you people perceive it as a already done, soon to be dominant paradigm shows that it very well could also fail on the latter issue.

I would say that crypto-currency is a new technology and bitcoin is our experiment with it. Like any new technology, we can make adjustments to get it right. The open source approach keeps it honest and peer reviewed. When we discover how powerful are its properties, then the experimental phase will transition into the industrial phase.

Yes,

However if the participants refuse to cooperate, what we are already seeing partially that what is percived as bitcoin by the speculators, namely its blockchain could be replaced by something else.  This has nothing todo with the project and the idea itself and even confirms to its 'beta' status.

Sure which has nothing to do with your belief you are owed a "fair share".  You aren't guaranteed a fair share in whatever might come along someday to replace Bitcoin either.

[robocop]

@robocop

You're squarely in the "Desperation" phase of the bubble graph.

You're also grasping at straws for anything you think is controllable to cease the natural decent of the market. If you're one of the dummies that jumped on board mid year 2011 by maxing out the credit cards to buy GPU's, welcome to reality.

Bitcoin's decline in perceived value has nothing to do with Alt Chains, Shorts or Phases of the Moon LOL,

For people like me who started mining in 2009 we understand that at even at $3.00 per BTC, it's still a 10X gain from what it was January 01, 2011 when it was $.30 per BTC and 50X since jan 2010.

It's all a matter of perspective, to me $3.00 is still a huge win.

No that's wrong. I don't bought GPUs or bitcoins near the high at 30$.

I don't have a problem with the lower price but i see a lot of guys who want make the fast money with bitcoins and not to invest change long-term in a alternative currency like me.

[ElectricMucus]

DeathAndTaxes: Hell I am.

Remind you fair doesn't necessary mean equal. But as in nature there are limits.
Read up on anarchistic principles or stop ignoring them, then we can continue our discussion.

[DeathAndTaxes]

DeathAndTaxes: Hell I am.

Remind you fair doesn't necessary mean equal. But as in Nature there are limits.
Read up on Anarchistic principles or stop ignoring them, then we can continue our discussion.

You aren't an anarchist you are a socialist and likely a statist.  If you feel your share isn't big enough do something about it.
I have more respect for botnet extortionists than someone whining their share isn't enough.

[ElectricMucus]

Justification remains subjective, categorize me all you want.

[cypherdoc]

Of course, that is a long way from where we are now, but I expect that merchants will start to use some time-averaged exchange rates for pricing their goods and services. Maybe once exchanges start to offer reasonably priced options/futures for Bitcoin...

Ah. But how could those futures be reasonably priced if speculation creates such insane volatility? And BTC trade in general and stable BTC denominated prices in particular will never become common when price swings are this high.
This is the catch 22: the economy needed for prices to stabilize is hampered severely by speculation induced volatility. And just as bad, this volatility is a vicious circle because high volatility attracts more gamblers speculators.

It will be at the very least challenging for bitcoin to overcome this.

Also, as to the comparison with oil/$; you might not care how much oil costs denominated in dollar if you get paid in btc and pay most of your bills in btc,  but if btc were that common by then, oil and other good would be priced in btc, and value fluctuations of btc would directly impact prices. This is happening today in our dollar/euro/whatever economy, because of speculators gambling on oil, commodity, gold and even food, price swings are considerable even if the currencies are relatively stable. When you add to that a currency thats unregulated and a free target for unlimited speculation, I just dont see how that will work. Your bread will cost 1 BTC one day and 20 next week. Never mind what you'd have to pay for imported good from countries where they dont denominate in BTCs.

you could very well be getting your wish.  we seem to be stabilizing here in the 2 range.  we'll see how long that lasts.

but you have to consider that Bitcoins long term fx might just be as an investment as opposed to a currency.  ideally it would be both but it could end up like gold whose major component of monetary injection is in the form of investment money (speculative).  not something you as a merchant want to hear or can control but certainly something to consider.

[P4man]

you could very well be getting your wish.  we seem to be stabilizing here in the 2 range.  we'll see how long that lasts.

Stabilizing? ROFL!
If stock exchanges swing as much as bitcoin does just about EVERY DAY, then its front page news and called a black friday. If you read about a currency swinging like that, then its probably an article about Zimbabwe.

but you have to consider that Bitcoins long term fx might just be as an investment as opposed to a currency.  ideally it would be both but it could end up like gold whose major component of monetary injection is in the form of investment money (speculative).  not something you as a merchant want to hear or can control but certainly something to consider.

If bitcoin never becomes a successful currency for trade, then please dont call it an investment, because it has no inherent value without trade. Call it what it is then, an online casino chip.

[cypherdoc]

If bitcoin never becomes a successful currency for trade, then please dont call it an investment, because it has no inherent value without trade. Call it what it is then, an online casino chip.

i'm not so sure about that.  i think it has backing, as in by the network, which secures and verifies its tx's as well as its existence.  it also has value in transferring the currency around the world and across borders.